India’s ministry of steel is preparing a report on the domestic steel industry’s preparedness in facing the European Union’s (EU) Carbon Border Adjustment Mechanism (CBAM), government sources said on Thursday, August 31.
They said that earlier in the week the ministry held rounds of discussions with representatives of domestic steelmakers and exporters seeking initiatives to face the CBAM.
Based on the inputs received, the ministry of steel’s report will lay down its assessment on the current state of preparedness of the domestic industry and will propose a roadmap for further measures to be taken to protect its interests in this key export market, the sources said.
The EU’s CBAM has come into force with effect from May 16 and reporting standards will come into effect from October 1 ending on January 31, 2024, and tax will be applicable on certain goods including iron and steel shipped into the region and based on the carbon intensity of the manufacturing process.
Significantly, the ministry of steel in an internal note said that the CBAM did not take into account the “common but differentiated responsibilities” or the fact that longer transitional periods are necessary for countries since the nationally determined contributions (NDCs) are different. These NDCs are based on the development levels, availability of raw materials, fossil fuels and other factors in the respective countries.